Among the fears on Wall Street, potential for GM bankruptcy

Top of the News: Among the many things weighing on this market — where investors increasingly worry about a sucker’s rally — is the rising potential for a bankruptcy court filing by General Motors.

As I write, GM shares are at $1.12 and falling. Imagine that. General Motors, once the world’s largest automaker and the symbol of American industrial might. “What’s good for America is good for General Motors and vice versa…” (CEO “Engine” Charlie Wilson’s actual quote). A buck and change,

The consequences of the Chapter 11 filing of much-smaller Chrysler are only beginning to be felt, many of them unintended. The supply chain is freezing up, an event that will affect even relatively healthy Ford. Creditors who lost big will reasonably be wary of investing in any new Big Three venture. Who will buy a car from a “bankrupt car company”?

A GM filing would take us even deeper into an undiscovered country, and the territory looks forbidding. Millions of jobs are at risk, as well as entire supply companies. Nobody has an exit strategy. No ideology can fix it. We may well be becoming a nation that buys far fewer cars. Unfortunately, GM was poorly prepared for this discontinuity. Even Wall Street, which can seemingly profit from anything, is worried.

The Back Story: Last week I noted that Washington Mutual didn’t make the list of 25 worst players in the subprime disaster. But a reader notes that the Center for Public Integrity report does include, at No. 5, Long Beach Mortgage, which was acquired by WaMu. Now the site makes that clear. It would make you cry — if it didn’t make you so mad, and cost this region so much.